07-19-2012, 10:40 PM | #1 | |
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Authors Sue Harlequin Enterprises for eBook Royalties
http://www.mediabistro.com/galleycat...yalties_b54677
Excerpts: Quote:
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07-19-2012, 11:06 PM | #2 |
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Sounds like Harlequin may have been recruiting some accountants in Hollywood.
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07-20-2012, 12:56 AM | #3 |
Treachery of images ...
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Wonder who spilled the beans on this lucrative earner by Harlequin .....
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07-20-2012, 01:04 AM | #4 |
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The problem with disgruntled employees, is that sometimes they have a legitimate reason to be disgruntled.
Biggest likelihood: an employee blew the whistle. |
07-20-2012, 07:35 AM | #5 | |
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Or maybe, since there are multiple filers, they pooled their funds to hire a good PI. They certainly hired a (reportedly) good lawyer. I wonder how many other BPHs cook their books to cheat their authors... (As oposed to cooking the books to cheat on taxes. ) |
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07-20-2012, 11:15 AM | #6 |
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If you actually read the article, it's not what y'all are making it out to be.
Some of the contracts signed between 1990 and 2004 were made with a Swiss subsidiary of Harlequin, and did not specify royalty rates for ebooks. Harlequin paid royalties for those ebooks in the 6-8% range. The attorneys are claiming that the authors didn't really sign with the Swiss subsidiary, but actually signed with Harlequin, and should get a 50% royalty rate for ebooks. Considering that Harlequin cranks out a ton of books every month, that back catalog sales are small, and that ebooks weren't very big in that time period, I doubt we're talking about trillions of dollars. It's also impossible to say who is right without thoroughly reviewing the contracts, which is the job of the court. |
07-20-2012, 11:36 AM | #7 |
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There's a wonderfully complete web site at http://www.harlequinlawsuit.com/ -- it has a summary and it has the actual complaint (which is remarkably clear even for those of us who aren't lawyers). 8)
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07-20-2012, 11:36 AM | #8 | ||
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Quote:
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07-20-2012, 11:51 AM | #9 | |
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Quote:
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07-20-2012, 11:54 AM | #10 |
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Jane at Dear Author has an excellent analysis of this.
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07-20-2012, 11:56 AM | #11 |
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If the contract specified that H were to pay the author 50% of what they received, and 6-8% of retail did indeed represent 50% of what H were receiving, then it perhaps is fair (or at least, in accordance with the contract, which may not be the same thing). That's for the court to decide.
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07-20-2012, 12:47 PM | #12 | ||
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The suit claims that Harlequin's swiss operation is not a real publisher but merely a tax-dodge (and author rip-off) front and that the real party to the contract is Harlequin enterprises. To prevail, they need to prove that Harlequin Switzerland is just an alias. Not trivial. But there is precedent so the case is not frivolous or hopeless. Quote:
Even if Harlequin wins they lose 'cause their defense is "yeah, we gave away your ebook rights. So what?" Not a good position to take if you intend to convince new writers to sign up with you. |
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07-20-2012, 12:57 PM | #13 | |
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H contracted with authors for 50%. H also set up H2 as a "publisher;" H2, however, did nothing but rubberstamp paperwork. H2 received all income and paid H 6% of that. Then H paid authors 50% of THAT, = 3%. So H/H2 kept 97% of the income and paid authors 3%, which is how 50% became 3%--a process that was completely obscured from authors, agents, and lawyers (due to their royalty report practices) until some events last year instigated a closer look. Now the court decides if what was done is legal. That'll probably take some time... (understatement) (It's probably obvious, but yes, I write for HQ, and I do have affected contracts. It's an interesting position to be in.) Doranna |
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07-20-2012, 01:27 PM | #14 |
Is that a sandwich?
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The legal fees may eat up any monetary award, if granted.
Is the ultimate goal to have the rights returned to the authors? |
07-20-2012, 03:31 PM | #15 |
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One point of consideration is who in that convoluted structure does manuscript acceptance and who negotiates the contracts.
The suit will have an easier road if the editors and contract negotiators are H.E. employees instead of actually sitting in the swiss offices. It speaks to who the authors and agents thought they were dealing with. |
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